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Enron Mail |
Enron Seeks Money for Trading Unit as Customers Flee (Update1)
Bloomberg, 12/03/01 Enron Says It Has $1.5 Bln in Bankruptcy Financing (Correct) Bloomberg, 12/03/01 Enron Acquisition Bid Announced by Standard Power (Update3) Bloomberg, 12/03/01 Enron to Cut 4,000 Jobs at Headquarters in Houston (Update6) Bloomberg, 12/03/01 Dynegy Sues Enron in Texas for Natural-Gas Pipeline (Update1) Bloomberg, 12/03/01 Enron Insiders Sold More Than $1.2 Billion in Stock Since 1990 Bloomberg, 12/03/01 U.S. Banks' Enron Debt Is Overstated, Analysts Say (Update1) Bloomberg, 12/03/01 Enron Corp. To Cut 4,000 Jobs In U.S., Bulk In Houston Dow Jones News Service, 12/03/01 Pension Plans Estimating Millions Lost On Enron Invest Dow Jones News Service, 12/03/01 Funds Liquidate Enron Bond Holdings, See Little Recourse Dow Jones News Service, 12/03/01 EOTT Energy Partners Not Party To Enron Bankruptcy Dow Jones News Service, 12/03/01 US Energy Markets Unmoved By Enron Chapter 11 Filing Dow Jones Energy Service, 12/03/01 Dueling Enron, Dynegy Lawsuits Start Of Long Battle Dow Jones News Service, 12/03/01 Stocks Slide on Worries about Middle East, Enron; Dow Industrials Down 1% in Late-Afternoon Trading Dow Jones Business News, 12/03/01 Dueling Enron, Dynegy Lawsuits Start Of Long Battle Dow Jones News Service, 12/03/01 FERC Chair Sees Enron Fall Fostering Market Transparency Dow Jones Energy Service, 12/03/01 IN THE MONEY: Enron's Bankruptcy Filing Was A Rush Job Dow Jones News Service, 12/03/01 USA: Enron says about 4,000 workers to be laid off. Reuters English News Service, 12/03/01 USA: U.S. House energy panel sets meetings on Enron. Reuters English News Service, 12/03/01 USA: Enron bankruptcy judge heard more high-profile cases. Reuters English News Service, 12/03/01 USA: US Northwest Natural seeks to buy Portland General. Reuters English News Service, 12/03/01 Enron Field moniker uncertain in wake of bankruptcy Associated Press Newswires, 12/03/01 EOTT Energy Partners, L.P. Not a Party to Enron Bankruptcy PR Newswire, 12/03/01 Enron Seeks Money for Trading Unit as Customers Flee (Update1) 2001-12-03 18:11 (New York) Enron Seeks Money for Trading Unit as Customers Flee (Update1) (Adds traders' comments in 19th-23rd paragraphs and adds details about pipelines stopping shipments in 20th paragraph.) Houston, Dec. 3 (Bloomberg) -- Enron Corp. is courting investors to revive its crippled trading business, even as it loses customers who fear the company will be unable to make good on its obligations. Energy companies such as Mirant Corp. and Aquila Inc. have taken business elsewhere. At EnronOnline, the Web site that once handled $2.8 billion in commodity transactions a day, trading has plunged, raising doubts that Enron will be able to rescue the trading business. Enron, once the largest energy trader, sought protection yesterday from creditors in a bankruptcy that was the largest in U.S. history. The company is in talks with financial institutions to fund the wholesale trading business ``under new ownership,'' Chief Operating Officer Greg Whalley said in a statement. ``Until we've seen the fallout from this bankruptcy, I don't think you're going to find a lot of entities that are prepared to trade with'' Enron, said Daniel Gordon, head of commodities trading at Hagerstown, Maryland-based Allegheny Energy Inc., which owns utilities in five states. ``Anyone who thinks this will be a quick bankruptcy is deluding themselves.'' Houston-based Enron has lost $26 billion in market value since mid-October, when the company restated $586 million in earnings and disclosed that its executives may have profited from Enron's dealings with affiliated partnerships that bought Enron assets. Enron, which was the buyer or seller on every transaction on its Web site, handles only a fraction of the trades it once did. The company said today it will fire 4,000 workers in Houston. `Difficult to Resurrect' The wholesale trading business of EnronOnline, which had been a valuable property, ``has for all practical purposes ceased operation and in a post-bankruptcy scenario, may in fact be difficult to resurrect,'' Fitch Inc., a Chicago-based firm that rates corporate credit, said in a report today. Trading has surged in markets that compete with Enron, including the New York Mercantile Exchange and Intercontinental Exchange Inc. Dynegy Inc. Chief Executive Officer Chuck Watson said his company's energy-trading Web site has seen increased traffic. ``EnronOnline will just disappear,'' said Peter Fusaro, president of Global Change Associates Inc., a consulting firm in New York. Enron's portfolio of trades ``is evaporating'' and ``is replaceable'' with competing electronic trading platforms. Dynegy's Watson said on a conference call with analysts and investors that his company would try to expand in Europe, where Enron was the dominant energy trader. Enron said Friday it would fire more than 1,000 workers in Europe. Shutdown EnronOnline shut down Wednesday after Dynegy canceled its plans to buy Enron, depriving Enron of the cash it needed to meet its obligations and all but ensuring the company would be forced to seek protection from its creditors. Later in the week, the site was offering trading in 472 commodity products, a third of its usual offerings, according to company officials. On Thursday, the site logged 825 trades, down from the normal amount of about 5,000. ``We're actively trading,'' Enron spokesman Eric Thode said today, declining to elaborate. ``There may still be trading going on, but it's primarily to unwind positions,'' Fitch credit analyst Ralph Pellecchia said. ``It's certainly not new growth or for profitability. For all intents and purposes, Enron's horsepower, its earnings-generating machine, has been effectively shut down.'' Needs Capital Enron declined to name the ``leading financial institutions'' it is in talks with to provide new capital for the trading business. ``If these discussions are successful, they could result in the creation of a new trading entity with a strong and unencumbered balance sheet,'' Whalley said. ``We understand that it may take time for counterparties to resume normal trading levels with this entity, but we are confident that this business can be put back on a solid footing.'' Enron's top creditors include Citigroup Inc.'s Citibank and J.P. Morgan Chase & Co. The Blackstone Group is helping Enron with its financial restructuring. A revival of Enron's trading business isn't likely anytime soon, analysts said. It may take ``months to years, if ever,'' said David Chang, manager of natural gas trading at Bank of America NA. In the meantime, Enron has ``alienated a lot of its suppliers and customers,'' he said. ``It would be difficult for'' Enron to come back. Stopped Shipping NiSource Inc., which operates 16,000 miles of gas pipelines, stopped shipping Enron's gas on Saturday because of credit concerns, company spokesman Kelly Merritt said. Williams Cos., which controls 27,000 miles of pipes, stopped shipping Enron's gas last week. ``Enron has lost all credibility,'' Fusaro said. In the meantime, some traders that had become accustomed to the ease and speed of online transactions are finding it difficult to adjust. Kevin Cokinos, co-owner and vice president at Cokinos Energy Corp. in Houston, said he has had to rely on his old network of telephone brokers for price quotes rather than Enron's Web site. ``It's hard to do as many deals because you're spending so much more time on each one,'' said Cokinos, whose company trades about 500 million cubic feet of gas a day. ``We hope somebody picks up EnronOnline so it will come back the way it operated before. But that might be kind of tough.'' --Bradley Keoun in the New York newsroom (212) 318-2310 or at Enron Says It Has $1.5 Bln in Bankruptcy Financing (Correct) 2001-12-03 17:55 (New York) Enron Says It Has $1.5 Bln in Bankruptcy Financing (Correct) (Corrects second paragraph say $250 million is part of the $1.5 billion in financing, not an additional loan. For more Enron news, see {TOP NRG <GO<}.) New York, Dec. 3 (Bloomberg) -- Enron Corp., which yesterday filed the biggest bankruptcy case in U.S. history, told a judge in New York that it has $1.5 billion in bankruptcy financing that will be provided by a bank group led by J.P. Morgan Chase & Co. The energy trader also asked U.S. Bankruptcy Judge Arthur Gonzalez for permission to draw $250 million of the financing immediately to keep its trading and other operations running while it tries to reorganize. --Jeff St. Onge and Jim Polson in New York with Andy Pratt in Enron Acquisition Bid Announced by Standard Power (Update3) 2001-12-03 17:05 (New York) Enron Acquisition Bid Announced by Standard Power (Update3) (Adds comment from Enron spokeswoman in sixth paragraph) Washington, Dec. 3 (Bloomberg) -- Enron Corp., once the seventh-largest company in the nation, has become the takeover target of a former natural gas marketer who wants to replace management and revitalize the bankrupt energy business. Richard Ryan, chief executive of an Oak Brook, Illinois, company called Standard Power & Light Inc., announced an offer to purchase at least a majority of Enron's common stock for less than $1 a share. Standard Power expects to file disclosure documents required for the bid by the end of next week, Ryan said. ``From a funding standpoint, everybody is asking me the same question: `Show me the money!''' Ryan said in an interview. ``Our goal is to complete the assembly of a management team, make sure the cash is there to do the deal, and then we are going to start making the filings.'' Buying Enron is a less daunting feat than it would have been before Enron's financial collapse, because its stock market value has plummeted to $298 million from about $67 billion in August 2000. Still, Ryan, who lacks an established name in the energy business, must convince Wall Street that his bid is legitimate. News of the pending offer caught the interest of investors and traders, seven of whom called or e-mailed Bloomberg News for more information on Ryan and Standard Power. Enron shares rose 14 cents, or 54 percent, to 40 cents today. Unusual Offer Karen Denne, an Enron spokeswoman, said, to her knowledge, Enron has yet to receive a formal offer from Standard Power. The takeover bid is unusual because Enron, based in Houston, filed for protection under Chapter 11 of the federal bankruptcy code on Sunday. When companies reorganize through a Chapter 11 filing, creditors and bondholders must be repaid before stockholders. The result is often that creditors get new shares in the company and existing stockholders are wiped out. Enron's bankruptcy proceeding is expected to be complex because it has many off-balance-sheet liabilities and contingent obligations. As a result, financial analysts are unsure of the extent of Enron's liabilities. Ryan said he thinks Enron's total debt is $45 billion to $50 billion. Enron and 13 of its units listed assets of $49.8 billion and debts of $31.2 billion in yesterday's bankruptcy filing. Return to Stockholders ``If you sell off the non-energy related business assets and companies, I think there is a good chance the company can retire all this debt and make a minimal return to equity holders over a 20- to 25-year term,'' Ryan said. Ryan estimated that this return would equal 10 to 12 percent for current stockholders on an after-tax basis. He said he is making a number of assumptions in this estimate. Standard Power was incorporated about six years ago to develop power plants and acquire generating assets, Ryan said. In June, the company sold its assets to a sister company called Standard Energy Ventures, and Ryan retired. Ryan said he has been following Enron since its inception and formerly worked in gas marketing with a number of people who were later employed at Enron, the seventh-largest U.S. company in terms of revenue last year. Standard Power is now signing contracts with third parties to manage Enron's pipeline and generating assets, Ryan said. This would alleviate some of the company's overhead so that incoming cash can be used to repay debt, he said. A worry for Ryan is that Enron has fired 1,100 people in the U.K. and said today it will cut 4,000 jobs at its Houston headquarters. Enron's workforce will be a critical factor in reviving the company's business and repaying creditors, he said. ``If they don't have any assets, we can't pay (the creditors) back,'' Ryan said. --Miles Weiss in Washington (202) 624-1879 Enron to Cut 4,000 Jobs at Headquarters in Houston (Update6) 2001-12-03 17:00 (New York) Enron to Cut 4,000 Jobs at Headquarters in Houston (Update6) (Adds comment from Texas governor in sixth paragraph.) Houston, Dec. 3 (Bloomberg) -- Enron Corp. will cut 4,000 jobs at its Houston headquarters, more than half of its staff there, as part of the energy trader's plan to survive the biggest bankruptcy in U.S. history. Enron told most of its Houston workers to go home and wait for notification of whether they were fired, spokeswoman Karen Denne said. Employees needed to keep the energy trading operations running are still on the job, she said. ``Trading operations will continue, and pipeline operations will continue,'' Denne said. She said she didn't know which jobs would be cut. Enron has said it will try to emerge from bankruptcy as an energy trading company backed by unnamed financial institutions. It will provide details in U.S. bankruptcy court in New York this afternoon on how it plans to cut back its investments in other businesses, such as managing energy consumption for corporations and wastewater treatment. The company fired about 1,100 workers in the U.K. on Friday. Enron had about 21,000 employees as of the end of September, two- thirds in the U.S., about fifth in the U.K. and the rest in other parts of the world. Enron employed about 7,500 people in Houston. Governor Rick Perry said he directed the Texas Workforce Commission to send ``rapid response teams'' to the city to help fired workers get services and assistance, said Gene Acuna, a spokesman for the Republican governor. Shares of Enron rose 14 cents to 39 cents. The stock traded as high as $90.75 last year. Rapid Demise The company, once the fastest-growing company in the energy business, began to unravel in October as it wrote off more than $1 billion of failed investments in water companies, broadband trading and retail electricity sales, and disclosed a $1.2 billion loss in shareholder equity because of its dealings with affiliated partnerships. Investors grew concerned that Enron was using the partnerships to hide debt and losses. The U.S. Securities and Exchange Commission is investigating, and Enron restated earnings for almost five years last month, wiping out $586 million in profits. Enron and at least 13 units declared bankruptcy yesterday, listing total assets of $49.8 billion and debts of $31.2 billion. It filed after Dynegy Inc., also based in Houston, backed away on Wednesday from a plan to buy Enron for about $23 billion in assumed debt and stock. Enron declared bankruptcy after failing to get financing needed to keep its daily operations running and its debt rating was lowered to junk, forcing it to pay off $3.9 billion in debt early. Workers streamed out of Enron's sleek glass office tower in downtown Houston at late morning today, carrying boxes of personal possessions and saying goodbye to each other. Police officers on horseback helped direct traffic on nearby streets. Employees said they were separated at the office this morning into two groups. One was told to leave and check Enron voice-mail for updates on their status. Members of the other were told they will be kept and were ordered to stay on the job, employees said. Integrity Questioned ``The worst thing was the ones they are going to keep were whisked away into a room like they were having champagne and caviar, and we were getting booted,'' said Chris Ihrig, who worked in Enron's industrial markets group, which traded steel and forest products. ``They always preached respect, integrity, communications and excellence, and it never was upheld.'' Enron Chairman and Chief Executive Officer Kenneth Lay said yesterday that he will try to keep workers who are key to running trading operations, which used to provide 97 percent of Enron's revenue before it began to slide toward bankruptcy in October. The company had more than $100 billion in revenue last year. Ihrig said about 75 percent of the industrial markets group was told to go home. He said the dismissed workers don't know what their severance pay will be. Their vacation time will be forfeited, he said. Enron workers who receive their pay by check as opposed to direct deposit were asked to not cash those checks until tomorrow, he said. ``Obviously, there is a cash problem,'' Ihrig said. Some workers blamed upper managers for the company's downfall, saying they didn't tell investors or employees what the company's problems were until too late. ``It's simple,'' said Wesley Wilder, also of the industrial markets group. ``The people at the top weren't as honest as they said they were.'' --Margot Habiby, Jim Kennett and Russell Hubbard in Houston Dynegy Sues Enron in Texas for Natural-Gas Pipeline (Update1) 2001-12-03 17:02 (New York) Dynegy Sues Enron in Texas for Natural-Gas Pipeline (Update1) (Updates with closing share prices in last paragraph.) Houston, Dec. 3 (Bloomberg) -- Dynegy Inc., answering a lawsuit filed as part of Enron Corp.'s Chapter 11 bankruptcy filing yesterday, sued in a Texas court to gain control of Enron's Northern Natural Gas Co. pipeline. Enron sued in federal court seeking $10 billion in damages and asking the court to prevent Dynegy from taking over the pipeline. The dispute came after Dynegy canceled its $23 billion buyout agreement with Enron on Wednesday. Dynegy had invested $1.5 billion in Enron to help keep it running until the merger could be completed. To back its investment, Dynegy got all the preferred stock in the Northern Natural line. Enron's suit accuses Dynegy of using the takeover bid to get the pipeline and remove, rather than rescue, a competitor. Dynegy says Enron didn't disclose all the debt it was obligated to pay and that it clearly has the right back out of the merger and take over the line or get its $1.5 billion back with interest. Dynegy's suit in Harris County District Court in Houston seeks a temporary injunction to force Enron to transfer the 16,500- mile pipeline to Dynegy, citing a provision in the buyout that allowed Dynegy ``automatic possession'' of the pipeline if the acquisition fell through. Dynegy also asked that the court permanently award it the pipeline. Shares of Dynegy fell $3.18, or 10 percent, to $27.17. Enron rose 14 cents to 40 cents. Both companies are based in Houston. --Jim Kennett and Margot Habiby in Houston, (713) 353-4871, Enron Insiders Sold More Than $1.2 Billion in Stock Since 1990 2001-12-03 16:37 (New York) Enron Insiders Sold More Than $1.2 Billion in Stock Since 1990 Houston, Dec. 3 (Bloomberg) -- Enron Corp. officers and directors sold more than $1.2 billion worth of the company's stock in the decade before the energy trader's Chapter 11 bankruptcy filing Sunday, the largest ever. Enron insiders, including Chairman Kenneth Lay and former Chief Executive Officer Jeffrey Skilling, sold almost 19 million shares between May 1990 and October 2001, according to Washington Service, which tracks insider transactions. Lay collected $143.7 million from the sales; Skilling, who stunned investors when he quit in August six months after becoming CEO, picked up $76.1 million. Employees and investors have sued Enron, accusing executives of selling shares while touting the company. Enron stock, which traded as high as $90 in August 2000, is all but worthless after the company wrote off more than $1 billion of investments and disclosed a $1.2 billion loss in shareholder equity because of its dealings with affiliated partnerships. ``They caused us to lose our money, and they made money,'' said Steve Lacey, an emergency dispatcher for Portland General Electric, Enron's Oregon-based electric utility unit. Lay didn't return telephones calls seeking comment and Skilling, through a spokesman, declined to comment. Lacey, like many of Portland General's 2,700 employees, bought Enron shares for his 401k investment plan. The stock, which he planned on using for his retirement, closed today at 40 cents. Lacey filed suit against Enron in Houston on Nov. 20, claiming the company prohibited employees from moving shares out of the investment plan as the stock fell in October. Billions Owed In its bankruptcy filing, Houston-based Enron and 13 of its units listed assets of $49.8 billion and debts of $31.2 billion. It owes billions to creditors such as Citigroup Inc., Bank of New York Co., J.P. Morgan Chase & Co., Duke Energy Corp. and Williams Cos. The insider selling at Enron is high for an energy company. Insiders at ExxonMobil Corp., the biggest publicly traded oil company, sold $410 million of stock during the same period, according to Washington Service, which compiles records from the U.S. Securities and Exchange Commission. Those sales pale in comparison with some computer-related technology companies. Microsoft Corp. insiders, among the most active sellers at any U.S. company, sold 367.2 million shares worth $31.4 billion since 1990, records show. In the past year, Microsoft insiders sold 3.6 million shares for $222 million. Biggest Seller In all, 60 officers, directors and trusts they control sold Enron stock during the past decade. Lou Pai, former chairman of Enron's NewPower Holdings Inc., made the most from selling Enron shares during the past decade. Pai sold 3.89 million shares for $270.3 million. Most of Pai's sales were made last year at prices ranging from $50.52 to $78.17 a share. Pai couldn't be reached immediately for comment. Ken Harrison, former chairman and CEO of Portland General, sold almost 992,000 shares for $78 million. Enron bought the utility in 1997 for $3.1 billion in stock and debt. Harrison also couldn't be reached immediately for comment. ``It would seem that insiders had some advance warning that there were better opportunities,'' said David Coleman, editor of Vickers Weekly Insider Report. The selling among Enron insiders outweighed the buying during the past decade. In all, insiders bought almost 488,000 shares, paying a total of $20.7 million. The last executive to buy Enron's stock: former Chief Financial Officer Andrew Fastow, who bought 10,000 shares on Aug. 16 at $36.98, according to the Washington Service. Fastow was ousted in late October after the SEC began an investigation into Enron's accounting and its use of investment partnerships. Enron restated earnings for almost five years in October, wiping out $586 million in profits, as it accounted for losses from the partnerships. Fastow couldn't be reached for comment. --Loren Steffy in Dallas (214) 954-9453 or steffy@Bloomberg.net U.S. Banks' Enron Debt Is Overstated, Analysts Say (Update1) 2001-12-03 16:54 (New York) U.S. Banks' Enron Debt Is Overstated, Analysts Say (Update1) (Updates with closing stock prices.) New York, Dec. 3 (Bloomberg) -- Enron Corp. says it owes Citigroup Inc., J.P. Morgan Chase & Co. and Bank of New York Co. $7.55 billion in the largest bankruptcy case in U.S. history. Analysts say the amount owed the banks may be less than half that. Here's where they differ. Enron yesterday said in court papers it owed thousands of creditors $31.2 billion in loans, unpaid bills and other debts. Citigroup, the biggest creditor, is owed $3 billion stemming from a loan it arranged last year, Enron said. Still, the banks probably hold only a fraction of the debts Enron says they're owed. That's because banks routinely sell parts of loans to other lenders as a way to disperse risk. Banks also are listed as the holders of bonds and other securities that in fact are owned by investors. The banks are listed as the creditors in Enron's papers. ``It's very difficult to piece together the reality,'' said Robert Napoli, an analyst at ABN Amro Inc. who owns Citigroup shares. ``They've syndicated out a portion of the loan and they could have hedged the credit risk through derivatives.'' Citigroup, the largest U.S. financial services company, is probably owed $1 billion at most, analysts say, and much of that is backed by collateral such as gas pipelines, on which it should be able to collect. The company's profit may be lowered by between $250 million and $500 million before taxes, or between 3 cents and 5 cents a share after taxes, as a result of its involvement with Enron, said Napoli, who recommends investors buy Citigroup shares. Citigroup earned $2.08 a share in the first nine months of the year. Hurting Earnings J.P. Morgan Chase -- which Enron says is owed $2.1 billion -- says its exposure totals about $900 million -- $500 million unsecured, and $400 million backed by collateral. That exposure could result in a 15-cent decline in earnings per share, said Goldman, Sachs & Co. analyst Richard Strauss. The second-largest U.S. bank earned $1.54 a share so far this year. J.P. Morgan Chase acts as a representative for holders of Enron bonds, so while the company is listed by Enron as a creditor on $1.9 billion of bonds, it may not be owed a cent on that debt. Enron's $2.45 billion debt to Bank of New York may work in much the same way, said Lehman Brothers analyst Henry Dickson. He estimated the bank is owed about $50 million. Much of J.P. Morgan's exposure is tied to Citigroup's $3 billion loan to Enron, a credit Enron doesn't even mention. A syndicate of at least five other banks -- including J.P. Morgan Chase -- contributed to that loan, according to Bloomberg data. As lead arranger, Citigroup likely holds about 10 percent of the loan, meaning its exposure is about $300 million. J.P. Morgan Chase's share of that is likely less. Bank of America Corp., Commerzbank AG and Barclays Bank Plc are among other Enron lenders not listed as creditors. Still, concern that the banks' losses may exceed forecasts helped send their shares and bonds lower today. Citigroup shares fell 99 cents to $46.91 in trading on the New York Stock Exchange. Citigroup's 7.25 percent notes due in 2010 fell to 107 28/32 from 108 21/32, pushing the yield up 21 basis points to 6.18 percent from 5.97 percent. J.P. Morgan's stock lost $1.17 to $36.55. Its 7.9 percent coupon notes due in 2010 fell $16 per $1,000 face amount to 111 3/32, pushing the yield up 23 basis points to 6.18 percent from 5.95 percent on Friday. Bank of New York's 7.3 percent notes maturing in 2009 fell about $20 per $1,000 face value to 108 3/32 from 110 7/32, traders said. Yield on the debt rose 32 basis points to 6.01 percent from 5.69 percent. Its shares dropped $1.04 to $38.20. ``They're big numbers, but these are big institutions,'' said Greg Habeeb, a bond money manager at Calvert Group, which doesn't own the banks' securities. ``I wouldn't be going running out buying the bonds now, but I don't think (Enron losses are) big enough to worry about.'' --Michael Nol, Terence Flanagan and George Stein in the New York Enron Corp. To Cut 4,000 Jobs In U.S., Bulk In Houston By Christina Cheddar Of DOW JONES NEWSWIRES 12/03/2001 Dow Jones News Service (Copyright © 2001, Dow Jones & Company, Inc.) NEW YORK -(Dow Jones)- Enron Corp. (ENE) will be terminating about 4,000 of its U.S. employees, with the bulk of the staff reductions being made in Houston, a spokeswoman said. Enron employed about 21,000 workers worldwide, with two-thirds of the staff in the U.S. and one-fifth in the U.K. The energy trader once employed 7,500 workers in Houston, where it is headquartered. The Enron spokeswoman said the company plans to ask a bankruptcy court later Monday to provide its workers with medical and other benefits, plus $4,500 each in severance. Enron filed for bankruptcy protection under Chapter 11 of the U.S. Bankruptcy Code late Sunday night in the U.S. Bankruptcy Court for the Southern District of New York. The initial hearing on the case is scheduled for 4 p.m. EST Monday. The spokeswoman said media reports have indicated 1,100 employees have been laid off at its U.K. operations, but she couldn't confirm these reports. -By Christina Cheddar, Dow Jones Newswires; 201-938-5166; christina.cheddar@dowjones.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. Pension Plans Estimating Millions Lost On Enron Invest By Christiane Bird Of DOW JONES NEWSWIRES 12/03/2001 Dow Jones News Service (Copyright © 2001, Dow Jones & Company, Inc.) NEW YORK -(Dow Jones)- Pension plans are estimating millions of dollars in losses on their investments in Enron Corp. (ENE). The once-mighty energy company filed for bankruptcy protection Sunday, following a dizzying decline in stock value, to 26 cents Friday from a 52-week high of $84.88 on Dec. 28. As among the largest investors in Enron, pension plans are also among those hardest hit by the Houston giant's fall. The $112 billion New York State Common Retirement Fund estimates its Enron losses to be about $58 million, said spokesman Jeff Gordon. Up until last week, the fund held about 2.1 million Enron shares in an internally managed index fund and about 2.5 million in externally managed active funds. However, "we sold almost all our 4.6 million shares on the day Enron was removed from the index - we're pretty much liquidated now," Gordon said. The $143 billion California Public Employees' Retirement System, or Calpers, is expecting a net loss of $45 million on its 3 million Enron shares. "That's based on an estimated average share price - we've been buying Enron at different prices for years," spokesman Brad Pacheco said. The plan also still has a $156 million interest in a joint investment with Enron called Joint Energy Development Investments II (JEDI II). "We're still evaluating that venture. The board will discuss its future at its next meeting," said Pacheco, noting that JEDI II, which invests in third-party energy companies, has given the retirement system a 74 percent return-on-investment since its inception in 1978. The $54 billion Ohio Public Employees Retirement System, which held 1.6 million Enron shares on Sept. 1, estimates its losses to be about $68.8 million, according to spokeswoman Linda Lewis. The plan acquired its Enron shares at an average price of about $43 each, and owns it through funds indexed to the Russell 3000. Similarly, the $7.6 billion State Retirement System of Illinois expects to lose about $15 million on its Enron investments, said Robert Knox, assistant director. The fund will lose about $5 million in Enron shares and about $10 million in Enron bonds, he said. Other pension plans are currently in the process of determining their losses - a detailed process that could take weeks, due to the complexities of their systems, plan representatives said. The $96 billion Florida Retirement System, which owns 9.7 million Enron shares in both indexed and actively managed funds, is "making calculations right now - it's a difficult actuarial matter because we bought stocks at different times," said spokeswoman Lee Baldwin. She estimated that the plan would be reporting its loss in about a week. The $85 billion New York City pension funds will also "take weeks to calculate losses, it's very complicated to figure out...We've owned some Enron stocks for years, probably since the company existed," said spokesman David Neustadt. The five New York City pension funds hold a total of about 2.9 million Enron shares, mostly in portfolios indexed to the Russell 3000. A spokeswoman for the $103 billion California State Teachers Retirement System, or Calstrs, said that the plan "won't comment on losses." Calstrs owns about 2 million Enron shares, of which 88% are in indexed funds and 12 percent in enhanced index funds. -Christiane Bird, Dow Jones Newswires; 201-938-2046; christiane.bird@dowjones.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. Funds Liquidate Enron Bond Holdings, See Little Recourse By John Shipman Of DOW JONES NEWSWIRES 12/03/2001 Dow Jones News Service (Copyright © 2001, Dow Jones & Company, Inc.) NEW YORK -(Dow Jones)- It looks as though mutual funds that had sizable positions in Enron Corp.'s (ENE) bonds rushed for the exits in the same fashion as those who owned the company's stock. Gary Schaefer, who manages the Monetta Intermediate Bond Fund, said he finished liquidating his Enron stake last week. Schaefer said the position had amounted to about 2% of the fund's $35 million in net assets. "It was significant," he said. "It was not a good day by a long stretch." "It's amazing that the kinds of things that took place (at Enron) were not more transparent," he said. Schaefer said he didn't expect his firm to seek any legal recourse regarding its losses on its Enron stake, in part because of the complexity and size of the financial morass. "This thing is years (away) from getting resolved," he added. The Huntington Short-Intermediate Fixed Income Securities Fund also unloaded its Enron bond holdings, said Chief Investment Officer Randy Bateman. He wouldn't say exactly when the bonds were sold, except that it was before Enron's bonds were cut to junk status. Bateman said the firm sold its holdings "based on internal credit analysis." He also said he did not expect his firm to seek any recourse on its investment. According to fund tracker Morningstar Inc., the Huntington fund also had about 2% of its net assets in Enron bonds. A spokeswoman for Strong Capital Management said the firm still owned a small amount of Enron bonds, but declined to comment further because the firm is in the process of trading in the position, she said. -By John Shipman, Dow Jones Newswires; 201-938-5171; john.shipman@dowjones.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. EOTT Energy Partners Not Party To Enron Bankruptcy 12/03/2001 Dow Jones News Service (Copyright © 2001, Dow Jones & Company, Inc.) HOUSTON -(Dow Jones)- EOTT Energy Partners L.P. (EOT) said its general partner wasn't among the companies included in Enron Corp.'s (ENE) voluntary petition for bankruptcy. As reported, Houston energy trader Enron filed for protection from its creditors in the biggest bankruptcy filing in U.S. history after its debt was downgraded to junk status and Dynegy Inc. (DYN) backed out of a deal to acquire the company. In a press release Monday, EOTT added that its subsidiary partnerships haven't filed for bankruptcy either. EOTT's general partner, EOTT Energy Corp., is a wholly owned subsidiary of Enron, and EOTT Energy Partners' doesn't have officers or directors of its own. Instead, the company's officers and directors are those of the general partner. In addition, EOTT's current working capital facility was obtained with Enron. On Friday, EOTT said it had signed an interim credit facility with its primary lender, Standard Chartered, to replace its existing facility with Enron. EOTT's New York Stock Exchange-listed shares recently traded at $12.30, up $3.30, or 36.7%, on composite volume of 2.25 millions shares, well above average daily volume of 119,810 shares. Trading in EOTT was extremely volatile Monday with shares hitting a low of $7.40 as investors assessed the company's link to Enron. The shares fell 38.6% on Friday to close at $9. Company Web site: http://www.eott.com -Cressida Connolly; Dow Jones Newswires; 201-938-5400 Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. US Energy Markets Unmoved By Enron Chapter 11 Filing By Kristen McNamara and Jon Kamp Of DOW JONES NEWSWIRES 12/03/2001 Dow Jones Energy Service (Copyright © 2001, Dow Jones & Company, Inc.) NEW YORK -(Dow Jones)- U.S. energy markets were largely unmoved Monday by Enron Corp.'s (ENE) filing for Chapter 11 over the weekend. Energy companies generally maintained their suspensions on trading with Enron and were casting a sharper eye on Dynegy Inc. (DYN), which is being sued by Enron for wrongfully terminating its offer to acquire the one-time market leader. No company was known to have altered its business with Dynegy, and many traders showed little concern about Enron's suit, but companies did say they were monitoring the situation. Major energy trader Aquila Corp. (ILA) was trading normally with Dynegy but monitoring the situation. "That situation could change depending on how people evaluate it," spokesman Al Butkus said. "It's a very fluid situation." FirstEnergy Corp. (FE) said it was also monitoring Dynegy's compliance with its credit requirements. "This is a situation that we're following closely," spokesman Ralph DiNicola said. Companies continued to do business normally with Dynegy, an energy broker said. Prices for North American power and gas weren't moved by Enron's filing, which was widely expected. Factors such as weather and longer-term supply fundamentals continued to dominate the power and gas markets. January gas futures on the New York Mercantile Exchange closed down 7.1 cents Monday at $2.640 per million British thermal units. Power prices in the U.S. Northeast were also weaker with mild weather forecasts, adequate generation and weak clearing prices. Power prices were also lower in the west. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. Dueling Enron, Dynegy Lawsuits Start Of Long Battle By Janet Whitman Of DOW JONES NEWSWIRES 12/03/2001 Dow Jones News Service (Copyright © 2001, Dow Jones & Company, Inc.) NEW YORK -(Dow Jones)- Dueling lawsuits filed by former merger partners Enron Corp. (ENE) and Dynegy Inc. (DYN) are only the beginning of what is sure to a long legal battle, merger and acquisition lawyers predict. At this stage, it's far from certain who would win, they add. "Remember the 100 years war that we all studied in history?," asks George M. Knapp, a partner at law firm Squire Sanders & Dempsey LLP. "This will make that look brief." Concurrent with its bankruptcy filing on Sunday, Enron filed a lawsuit against Dynegy, charging its former suitor had no grounds to terminate their $9 billion merger and actually contributed to Enron's collapse. The suit, which was filed in New York in the same court as the bankruptcy petition, also contends that Dynegy has no right to acquire Enron's valuable pipeline company, Northern Natural Gas Co. of Omaha, Neb. In a counter suit filed Monday in Harris County, Texas, Dynegy seeks immediate control of the Northern National pipeline company. Under the terms of the cross-town rivals' original merger agreement, Dynegy received an option to buy the coveted property - even if the merger fell apart - after it injected $1.5 billion into Enron. Now, however, that's a matter for the courts to decide. "This is a kind of lawyers' paradise," said Tom Burnett, president of Merger Insight, an affiliate of Wall Street Access. "The risk to Dynegy is that that contract won't hold up to buy the Northern Natural Gas assets. A bankruptcy judge may decide to hold an auction." In that event, Dynegy would be left with an equity stake in Enron. Sensing that the companies are in for long legal battle and that Dynegy may not wind up with the pipeline assets, some investors unloaded their Dynegy shares, sending the stock price sliding more than 8% Monday to a low of $26.26. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. Stocks Slide on Worries about Middle East, Enron; Dow Industrials Down 1% in Late-Afternoon Trading By Peter Edmonston 12/03/2001 Dow Jones Business News (Copyright © 2001, Dow Jones & Company, Inc.) The Wall Street Journal Online Stocks retreated Monday as conflict in the Middle East and a bankruptcy filing by energy giant Enron outweighed better-than-expected economic data. In late-afternoon trading, the Dow Jones Industrial Average was down 101 points, or 1%, to 9751 after trading nearly 150 points lower earlier in the day. The Dow industrials fell 22.14 points Friday. Meanwhile, the Nasdaq Composite Index lost 22 points, or 1.1%, to 1908.60 after closing 2.68 points lower in the previous session. Other major indexes also declined Monday. The Standard & Poor's 500-stock index dropped 9.60 to 1129.90, the Russell 2000 Index fell 2.80 to 458, and the New York Stock Exchange Composite Index shed four to 575.20. Bonds turned higher in choppy trading. The dollar strengthened against the yen and the euro. Concerns over the fallout from the weekend's suicide bombings in Israel damped any beneficial effects from economic reports that exceeded Wall Street's expectations. "The events in Israel have created a lot of uncertainty," said Peter Coolidge, senior equity trader at Brean Murray & Co. "That more than counteracts any positive news on the economic front." At least 25 people were killed over the weekend in attacks by Palestinian suicide bombers in Jerusalem and the northern Israeli port city of Haifa. On Monday, Israel fired nine missiles near Palestinian leader Yasser Arafat's headquarters in Gaza City in an apparent retaliation. The violence overseas detracted from some fairly upbeat readings on the U.S. economy, including a report from the Commerce Department that consumer spending rose by a record 2.9% in October. Robust spending on cars and other big-ticket items contributed to the reading's largest jump since 1959, when the data series began. The previous record had been a 2.6% increase in September 1987. Personal income was virtually unchanged for the second month in a row, roughly in line with economists' forecasts. The Commerce Department also surprised economists by reporting a 1.9% increase in total construction spending for October. Forecasts had that figure falling by 0.5%. September construction spending was revised to show a 0.7% drop from the 0.4% decline previously reported. Meanwhile, a closely watched index of manufacturing activity rose more than expected in November. The National Association of Purchasing Management reported Monday that its purchasing managers index rose to 44.5 last month from 39.8 in October. Economists have been forecasting the PMI would rise to 42. A PMI reading of 42.7 is considered the threshold between expansion and contraction in the wider economy. So November's PMI of 44.5 suggests that the economy is growing, albeit slowly. Last week, the National Bureau of Economic Research formally declared that the country had entered a recession back in March, ending the longest period of economic expansion in U.S. history. The government reported that total economic activity fell at an annual rate of 1.1% in the July-September quarter. Against this backdrop, analysts called the latest NAPM data encouraging. "After absorbing last month's aftershock of the terrorist attacks, the manufacturing sector showed surprising resilience in November," Norbert Ore, director of the survey, said in a statement. "The trend is definitely in the right direction, but it is too soon to claim an imminent recovery. Based on this report, the sector regained a significant portion of the output lost in October," Mr. Ore said. Matthew Freedman, an economist at Economy.com, said the NAPM report "shows that the deterioration in manufacturing appears to be slowing quite dramatically." But the stronger-than-expected numbers did little to comfort investors, who have been scrutinizing economic readings in recent weeks for signs that the business cycle has hit bottom. The markets are especially interested to see if rising levels of unemployment will put a dent in consumer spending, which is considered a key to keeping the current economic recession a mild one. Most major international markets traded lower Monday, but the U.S. economic data helped narrow the losses late in the day in Europe. Frankfurt's Xetra DAX closed essentially flat and London's Financial Times Stock Exchange 100-share finished 0.8% lower. In Asia, Tokyo's Nikkei 225 Stock Average closed with a loss of 3.1%, and Hong Kong's Hang Seng Index dropped 1.1%. Meanwhile, the turmoil surrounding energy-trading giant Enron continued over the weekend, as the company filed for bankruptcy protection on Sunday. The Houston firm simultaneously sued its would-be merger partner Dynegy for "not less than $10 billion," accusing it of wrongful termination of their merger pact. News of the impending collapse of Enron had weighed heavily on the market last week. Some market participants suggested Enron's bankruptcy filing -- the largest in U.S. history -- continued to pull stocks lower on Monday. But others said it was largely expected and was having little effect on share prices. "It could hurt the markets somewhere down the road, but I haven't heard a lot of people talking about it [Monday]," said Mr. Coolidge of Brean Murray. Enron shares rose 11 cents to 37 cents. Dynegy was down nearly 8%. Financial-services stocks took a hit Monday, dragged lower by some negative comments from analysts and fears about exposure to the Enron debacle. Shares of brokerage firm Morgan Stanley sank 6% after Goldman Sachs analyst Richard Strauss pulled it from his recommended list and cut his rating on the stock to "market perform" from "market outperform." Mr. Strauss said that the 60% surge in Morgan Stanley's shares since Sept. 20 has made it expensive compared to its peers. Citigroup, a component of the Dow Jones industrials, declined nearly 2.7% and J.P. Morgan fell 3.8%. The two companies advised on the failed merger between Enron and Dynegy and now find themselves among Enron's largest unsecured creditors. Automotive stocks were also trading lower Monday as the big auto makers offered up monthly sales results for November. Shares of Ford Motor were down 6.1% on news that it is expected to warn this week that quarterly results will miss forecasts. Separately, the company reported a 4.4% increase in total U.S. vehicle sales, helped by 0% financing offers. Ford rival General Motors, which has also been offering generous financing plans to lure buyers, reported a 13.3% jump in car and truck sales from a year ago. Shares of GM fell 1.4%. In major U.S. market action: Stocks fell. On the Big Board, where 923.7 million shares traded, 1,804 stocks fell and 1,291 rose. On the Nasdaq, 1.17 billion shares changed hands. Bonds rose. The 10-year Treasury note rose more than 1/4 point, or $2.50 for each $1,000 invested. The yield, which moves inversely to price, fell to 4.71%. The 30-year bond added more than 3/8 point to yield 5.26%. The dollar strengthened. It bought 123.93 yen and traded at 89.14 cents to the euro, compared with 123.44 yen and 89.65 cents late Friday in New York. Copyright © 2001 Dow Jones & Company, Inc. All Rights Reserved. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. Dueling Enron, Dynegy Lawsuits Start Of Long Battle By Janet Whitman Of DOW JONES NEWSWIRES 12/03/2001 Dow Jones News Service (Copyright © 2001, Dow Jones & Company, Inc.) NEW YORK -(Dow Jones)- Dueling lawsuits filed by former merger partners Enron Corp. (ENE) and Dynegy Inc. (DYN) are only the beginning of what is sure to a long legal battle, merger and acquisition lawyers predict. At this stage, it's far from certain who would win, they add. "Remember the 100 years war that we all studied in history?," asks George M. Knapp, a partner at law firm Squire Sanders & Dempsey LLP. "This will make that look brief." Concurrent with its bankruptcy filing on Sunday, Enron filed a lawsuit against Dynegy, charging its former suitor had no grounds to terminate their $9 billion merger and actually contributed to Enron's collapse. The suit, which was filed in New York in the same court as the bankruptcy petition, also contends that Dynegy has no right to acquire Enron's valuable pipeline company, Northern Natural Gas Co. of Omaha, Neb. In a counter suit filed Monday in Harris County, Texas, Dynegy seeks immediate control of the Northern National pipeline company. Under the terms of the cross-town rivals' original merger agreement, Dynegy received an option to buy the coveted property - even if the merger fell apart - after it injected $1.5 billion into Enron. Now, however, that's a matter for the courts to decide. "This is a kind of lawyers' paradise," said Tom Burnett, president of Merger Insight, an affiliate of Wall Street Access. "The risk to Dynegy is that that contract won't hold up to buy the Northern Natural Gas assets. A bankruptcy judge may decide to hold an auction." In that event, Dynegy would be left with an equity stake in Enron. Sensing that the companies are in for long legal battle and that Dynegy may not wind up with the pipeline assets, some investors unloaded their Dynegy shares, sending the stock price sliding more than 8% Monday to a low of $26.26. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. FERC Chair Sees Enron Fall Fostering Market Transparency By Mark Golden Of DOW JONES NEWSWIRES 12/03/2001 Dow Jones Energy Service (Copyright © 2001, Dow Jones & Company, Inc.) NEW YORK -(Dow Jones)- The collapse of Enron Corp. (ENE), although a human tragedy, could give a major boost to transparency in energy markets and the energy industry, Federal Energy Regulatory Commission Chairman Patrick Wood III said Monday. "The market doesn't like clouded players and has a relentless way of moving them to the sidelines," Wood said in a speech at an energy investors conference in New York. Unanswered questions about how the one-time market leader was making its money, and how much it was making, contributed to the unraveling of confidence in the company that brought about its swift collapse. Enron's Chapter 11 filing Sunday is "emphatically not" an impediment to the development of transparent, competitive power markets, Wood said. The chairman said he hadn't planned to discuss Enron's situation, but departed from his planned remarks due to the high level of interest following the company's filing for bankruptcy-court protection. Enron's employees will likely find work at a "new breed of energy companies" with more open cultures that, Wood hoped, would be the only kind of energy companies around in five years. Wood characterized Enron's collapse as "a hiccup - or, more graphically, a belch - heard 'round the world." Separately, the nation's top energy regulator said price controls will remain a feature of the country wholesale electricity markets for the foreseeable future. By this spring, Wood expects FERC to lay out rules for dividing control over the country's high-voltage transmission lines - across which wholesale power is moved - among a handful of independent operators. Those rules will include measures to adjust prices when markets get out of control, Wood said. The details haven't been hammered out yet, but the controls would likely resemble those in effect in the Mid-Atlantic electricity market run by PJM Interconnection LLC, Wood said. Specifically, the $1,000 price cap in place in PJM will likely be needed in other markets until consumers are able to quickly reduce their usage when prices spike, he said. The chairman clearly wasn't satisfied with the current cost-based price controls in place in the western U.S. power markets. "I never want to rely again on such a blunt tool," Wood said. "In California, we did what we had to do." Such caps discourage investments in power plants used only when demand peaks, Wood agreed. Price limits make it difficult for those plants to recover their costs, he said. FERC won't be looking at retail electricity competition any time soon, Wood said. "My mandate at this time is standardization of wholesale markets," he said. "When you put down the rules and tell people how they're going to get their money back, the money comes in, and not at such a high-risk premium for the financing." Wood expects heavy investment in merchant transmission, just as there has been heavy investment in merchant generation over the past few years. FERC expects soon to write a standard national contract for hooking up new power plants to the country's transmission system. -By Mark Golden, Dow Jones Newswires; 201-938-4604; mark.golden@dowjones.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. IN THE MONEY: Enron's Bankruptcy Filing Was A Rush Job By Michael Rapoport 12/03/2001 Dow Jones News Service (Copyright © 2001, Dow Jones & Company, Inc.) A Dow Jones Newswires Column NEW YORK -(Dow Jones)- Apparently Enron Corp. (ENE) still hasn't quite gotten the hang of this little concept of full disclosure - even now that it's paid a heavy price for not providing it. The day after Enron filed for Chapter 11 bankruptcy protection, an assortment of peculiarities and unanswered questions still surrounds the company - from information missing from the company's bankruptcy filing to the question of why Enron filed over the weekend in a court far from its home. Let's give the fallen energy giant the benefit of the doubt and assume that the lingering questions and missing pieces stem from an enormous rush to file for Chapter 11 as quickly as possible, rather than from any more-nefarious motive. Certainly the past several weeks, in which Enron collapsed as ever-worse information dribbled slowly out of the company, have given investors reason enough to be suspicious of what Enron says. But whatever the reason behind it, the effect of all this uncertainty is the same: It means that nagging questions about just how well Enron can get a handle on its own chaotic situation, and whether it can continue as a viable business in the wake of its problems, just won't go away. Let's start with Sunday's filing, which notes that Enron has $13.15 billion in debt - but acknowledges that that amount "does not reflect off-balance-sheet and contingent obligations." Hmmm. Wasn't the revelation that Enron had moved so much of its debt off its balance sheet - to entities controlled by its own executives, yet - a big part of what got it in trouble to begin with? Seems the level of that debt is certainly something anyone concerned about an Enron bankruptcy would want to know, but it seems Enron either can't or won't provide it. Either way, it's not an encouraging sign. There are other holes in Enron's filings. The list of the creditors holding Enron's five largest secured claims, for instance, consists of Citibank, Chase Manhattan Bank and three entries that all read like this: "Not available at this time. To be provided at a later date." Location of the substantial assets held by the Enron subsidiaries that filed for bankruptcy along with the parent company? "Information regarding the location of the other debtors' substantial assets is not available at this time and will be provided at a later date," Enron said. Enron's estimated weekly payroll and cash disbursements and receipts for the next several weeks, matters that are now under the bankruptcy court's jurisdiction? Not available. The situation is so convoluted and hurried that even some of the information Enron HAS filed appears to be a little fluid. As Christina Cheddar of Dow Jones Newswires has reported, CMS Energy Corp. (CMS), which Enron lists as one of the creditors of its marketing and trading unit, says it actually owes Enron money when all its trading positions are netted out. Two more curious factors, both of which speak to the haste in which Enron filed its bankruptcy petition: the fact that it filed on a Sunday - which even in hurly-burly New York, where the filing was made, is mostly a day for rest, football and the Sunday paper - and filed before it had nailed down the debtor-in-possession financing it needs to keep operating. What was so urgent about Enron's need to file that it couldn't wait for Monday morning, or till it had financing in place? An Enron spokesman declined to comment. Was it because Enron felt it had to file quickly to throw a monkey wrench into efforts by its savior-turned-nemesis Dynegy Inc. (DYN) to take over Enron's Northern Natural Gas Co. unit? Was it to stabilize a situation in which Dynegy claims Enron has been having trouble delivering natural gas to its customers to meet its obligations? At this point, no one besides Enron and its lawyers really knows. All this ambiguity only lends credence to the idea that even Enron is having trouble getting its arms around the tangled financial structure that made the company nearly impossible for even Wall Street's savviest minds to understand. And the missing information about the off-balance-sheet debts and the creditors' claims, in particular, suggests that Enron's search for unencumbered assets to back its new financing may be more difficult and chaotic than the company had hoped. In a weird way, the very chaos of the process may actually speak well of Enron's honesty: If Enron was trying to mislead anyone and had a real reason to believe its rescue deal with Dynegy might fall apart, wouldn't it have had a bankruptcy filing at the ready, with all i's dotted and t's crossed, instead of going through this? Maybe. Right now, though, all indications are that this bankruptcy filing is a serious rush job, with some significant information uncertain or missing. And that's not a situation that any investor or potential investor in Enron should be happy about. -By Michael Rapoport, Dow Jones Newswires; 201-938-5976; michael.rapoport@dowjones.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. USA: Enron says about 4,000 workers to be laid off. 12/03/2001 Reuters English News Service (C) Reuters Limited 2001. HOUSTON, Dec 3 (Reuters) - Shattered energy trader Enron Corp. will lay off about 4,000 employees as part of a cost-cutting move in the wake of its bankruptcy filing, a spokesman said on Monday. "We're planning about 4,000 job cuts, most from Houston," spokesman Mark Palmer said. Some 7,500 people are employed in the company's Houston head office. Enron capped a dramatic fall from the heights of the energy world on Sunday, filing the biggest bankruptcy case in U.S. history. The assets involved total $49.8 billion, easily dwarfing the $35.9 billion held by Texaco at the time of its 1987 bankruptcy. Sources said Enron's massive computer network was being shut off, floor by floor, and leaders of business units informed their employees that they were to go home for the day and await notice of their future with the company. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. USA: U.S. House energy panel sets meetings on Enron. 12/03/2001 Reuters English News Service (C) Reuters Limited 2001. WASHINGTON, Dec 3 (Reuters) - A U.S. congressional panel said on Monday it had scheduled meetings with representatives of the Securities Exchange Commission, auditing firm Arthur Andersen and Enron Corp. to explore the energy giant's rapid disintegration. Rep. Billy Tauzin, chairman of the House Energy and Commerce Committee, has directed his staff to meet with the SEC, Enron financial auditor Arthur Andersen and top Enron executives, a panel spokesman told Reuters. "The committee will be moving aggressively to pin down what went wrong and what, if anything, Congress can do to prevent this type of thing from happening again," a spokesman for the Louisiana Republican said. Committee staff will meet with SEC's head of enforcement and general counsel on Tuesday and with top representatives from Arthur Andersen on Wednesday, the spokesman said. On Thursday, three House energy committee staffers will travel to Houston to meet with top Enron officials "to begin laying the groundwork for a hearing," the staffer said. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. USA: Enron bankruptcy judge heard more high-profile cases. 12/03/2001 Reuters English News Service (C) Reuters Limited 2001. NEW YORK, Dec 3 (Reuters) - Judge Arthur Gonzalez, who will hear the bankruptcy protection case of Enron Corp. , is a veteran of several high-profile cases, including this year's Chapter 11 filing by appliance maker Sunbeam Corp. "They're lucky to have him," said one lawyer who has represented a company that appeared before Gonzalez in U.S. Bankruptcy Court for the Southern District of New York. The lawyer, who requested anonymity, said Gonzalez was viewed as "a very fair judge. "He is extremely deliberate, very hard-working and very thorough," he told Reuters. "I don't think there was a single hearing at which he had not read all the pleadings. Other judges are more laissez faire and some don't read all the pleadings, preferring to just ask questions," the lawyer said. "Judge Gonzalez makes careful decisions." Asked if that meant Gonzalez was inclined to favor a company petitioning for bankruptcy protection, he said: "Well, there are certain judges you would prefer not to have." Gonzalez, who was appointed to the federal bankruptcy court in New York in 1995, has recently been hearing the case of Sunbeam, which filed for Chapter 11 protection this year after questions about its accounting. In May, federal securities regulators accused former top executives at the appliance maker - including former Chief Executive Albert "Chainsaw Al" Dunlap - of financial fraud that cost investors billions of dollars. Last week, Gonzalez postponed a hearing on Sunbeam's second amended plan of reorganization - which was to be heard on Tuesday - to next March 19. Coincidentally in both cases, in which the company's accounting is central, the accounting firm Arthur Andersen was auditor for Sunbeam and also Enron. Gonzalez also oversaw the 1998 bankruptcy filing of Livent Inc., the Canadian theater-production company that collapsed amid major accounting irregularities. Last year, Gonzalez was on the bench for the case of Iridium LLC, a satellite telephone service, which entered the history books as one of the costliest corporate fiascoes of all time. The Washington-based company cut off telephone service to its 55,000 customers as a prelude to court-ordered liquidation. Iridium's last act was to "de-orbit" or ultimately burn up its constellation of 66 satellites. The network has been reported to have cost $5 billion to $7 billion. Gonzalez cleared Iridium to spend $8.3 million to start winding up its business while selling remaining Earth-bound assets, including ground stations. Last year, he was also in charge of the case involving U.S. Media Holdings Inc. and its Golden Turtle Press Inc. unit which filed Chapter 11 petitions. This year, Gonzalez has been hearing the Chapter 11 case of insurance company Reliance Group Holdings Inc. and also Australia's collapsed HIH Insurance Ltd. Gonzalez received a degree in accounting from New York's Fordham University in 1969 and a master's degree in education from Brooklyn College in 1974. He got his law degree at Fordham University's law school in 1982 and LLM in taxation in 1990 from New York University Law School. After a spell in private practice, he was appointed Assistant U.S. Trustee in the Southern District of New York in 1991 and U.S. Trustee for the Second Circuit in 1993. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. USA: US Northwest Natural seeks to buy Portland General. By Chris Baltimore 12/03/2001 Reuters English News Service (C) Reuters Limited 2001. WASHINGTON, Dec 3 (Reuters) - Northwest Natural Gas Co said Monday it asked approval from federal energy regulators to buy Portland General Electric Co. from Enron Corp for $1.8 billion. Northwest expects to soon file a similar request with the U.S. Securities and Exchange Commission, a company spokesman said. The purchase is unrelated to the status of Enron's Northern Natural Gas Pipeline, to which Dynegy Inc. is claiming rights after canceling a bid to purchase Enron last week. Portland, Ore.-based Northwest Natural Gas is a local natural gas distribution company that serves about 530,000 customers in Oregon and Washington. It is Oregon's largest natural gas utility, while Portland General is the state's biggest electric utility. Northwest filed for approval with the Federal Energy Regulatory Commission (FERC) on Friday, after a similar application with the Oregon P
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